Britain's Economic Crisis: The Rising Cost of Sickness and the Need for Action
The UK is facing a looming economic crisis as the number of sick and disabled people out of work continues to rise, posing a significant threat to the country's prosperity. A recent report highlights a concerning trend: there are 800,000 more people out of work due to health conditions compared to 2019, resulting in a staggering annual cost of £85 billion to employers. This issue demands immediate attention, as it could worsen without intervention, potentially leading to a crisis of economic inactivity.
Sir Charlie Mayfield, the former John Lewis boss and leader of a new taskforce, emphasizes that this situation is not inevitable. The taskforce aims to assist individuals in returning to the workforce, but it faces challenges. Some business groups argue that Labour's Employment Rights Bill includes disincentives for hiring people with existing illnesses, creating a complex landscape for employers and employees alike.
The report reveals alarming statistics: one in five working-age individuals are out of work and not seeking employment. If no action is taken, another 600,000 people may leave the workforce due to health reasons by the end of the decade. The consequences extend beyond individual employers, as sickness and staff turnover disrupt operations, incur costs, and result in lost experience. For the country, this translates to weaker growth, increased welfare spending, and heightened pressure on the NHS.
Loz Sandom, who struggles with mental and physical health conditions, exemplifies the challenges faced by many. Despite their willingness to work, finding employment has been difficult. Sandom highlights a crucial aspect: employers often fail to recognize their duty to provide reasonable adjustments, creating a barrier to employment for individuals with disabilities. This situation is detrimental, as it means employers miss out on the talents and contributions of capable individuals.
The government has responded to the report with a major partnership involving over 60 companies, including Tesco, Google UK, Nando's, and John Lewis. Over the next three years, these companies will collaborate to develop and refine workplace health approaches, aiming to reduce sickness absence, improve return-to-work rates, and increase disability employment. The government's goal is to transform these changes into a voluntary certified standard by 2029.
Work and Pensions Secretary Pat McFadden emphasizes the benefits of this approach, stating that it is a 'win-win' for employees and employers, as it focuses on keeping individuals with health issues or developing disabilities in the workforce. McFadden highlights the mutual benefits of this strategy, as employers retain experienced staff, and employees have the opportunity to stay in work. However, the success of the report's recommendations relies on the understanding and support of businesses and policymakers at the national and regional levels.
The Employment Rights Bill, which some businesses argue will stifle growth, includes a right to guaranteed hours and stricter regulations on zero-hour contracts. Additionally, Chancellor Rachel Reeves aims to guarantee paid work for young people who have been out of a job for 18 months, with potential consequences for those who do not take up the offer. The resolution of Britain's economic inactivity problem requires a comprehensive approach, addressing cultural fears, providing adequate support, and removing structural barriers to work.
